Entertainment

Loopt Star: A Digital Loyalty Card For Your iPhone

Location-based social service Loopt is launching a new mobile rewards game called Loopt Star. Loopt Star will let users check in to different locales to not only compete with friends (a la Foursquare and Gowalla), but to also earn rewards from retailers and organizations. Loopt Star is basically a virtual loyalty card with a built-in social game.

Using the free iPhone app (other platforms are being evaluated, but Loopt Star will be for the iPhone only at first), users can check in at participating organizations and earn rewards, points or discounts, based on a set of factors designated by the establishments. That means that rewards and reward amounts can be altered depending on time of day, day of the week and how frequently the person has checked in in the past.

While other location-based services like Foursquare have offered discounts and loyalty rewards to users based on where they check in and how often, the focus hasn't been specifically on earning and offering rewards. With Loopt Star, that's the focus.

What Is Loopt Star

Loopt Star does borrow a lot of its social game elements from Foursquare — there are badges, leaderboards and the ability to become the "Boss" of a location — however, it also differs significantly from the other location-based services already available.

Loopt Star is based entirely on Facebook Connect. Instead of having to build or import your social graph, Loopt Star simply uses Facebook. We think this is pretty brilliant because it lets users get started immediately. Users can then share their current location in real time with their Facebook friends and alert them about special Loopt Star offers via newsfeed.

Brands can customize campaigns based on location, the number of visits, how many people are in a group, time of day or day of the week.

Wi-Fi location technology is used to limit cheating.

Users can view "Nearby Rewards" in the app and also get updates of rewards for places they have been before or that their friends share with them.

Loopt has already signed more than 20 sponsors and will launch with several large companies including The Gap, Universal Records, Burger King, Starbucks and Stanford University. New brands will be rolled out each week in the application.

What rewards users get depends on the brand. For instance, if you visit The Gap twice, you'll earn a 25% discount. Meanwhile, Burger King customers in New York City who want to "have it [their] way" three times will get a free coffee or soda alongside a qualifying sandwich.

Universal Music will be giving away MP3s to users who check in at certain bars and Starbucks will offer special badges and discounts for the most frequent customers, much like it does with Foursquare and Brightkite.

Simplicity = Smart

What we like best about Loopt Star is that it's extremely simple. The app plugs into your Facebook social graph and then makes it easy to share location info and check in to places to earn points and rewards.

In a recent editorial post about why location hasn't gone mainstream, Leah Betancourt argued that its value to advertisers was questionable. Loopt Star isn't designed to be its own social network; Facebook and Twitter and other services can do that better. Instead, it can be a location guide and a virtual loyalty card. The coupons and the simplicity offer the user value, while the ability to set parameters around offers and to better target existing users offers businesses and advertisers value.

When I spoke with Loopt CEO and Founder Sam Altman about the new product, he stressed that even if Facebook does get into location on its own terms, that doesn't cannibalize what Loopt Star is doing. On the contrary, it makes the overall service even more valuable as Facebook better integrates with location. If everything is coming in from the same stream and everything is based on the same social graph, Loopt Star can offer its sponsors and users a certain experience while still tying into the core Facebook ecosystem.

We think that's extremely shrewd. We also think that giving advertisers and business owners more options and granular control over their campaigns will lead to more creative and expansive uses. We've been waiting for a location-based service to eschew the pretense of being a social network and instead embrace the advertising opportunities

A Competitive Space

Loopt was at the forefront of the location-based space, but despite having a diverse suite of mobile apps and support for lots of platforms, the service has taken a backseat as social gaming services Gowalla and Foursquare have moved to center stage.

With Loopt Star, Loopt is getting into the social gaming space but with a very clear purpose. From the offset, Loopt Star wants to offer value to users and offer value to advertisers. The value for advertisers is crucial because the companies that will end up leading this space are those that are most able to sell a cost-per-visit strategy to business owners and retailers.

To be sure, Foursquare and Gowalla have crazy momentum right now, with Foursquare reporting nearly 1 million checkins a day. However, this is a space that has yet to truly explode and there are still plenty of opportunities for other companies and services to get a shot at claiming some of this virtual (and physical) space.

By using Facebook as the basis for the Loopt Star social graph, we think that Loopt is on the right track to building a service that users will actively use. Now it will just be up to the company to secure the sponsorships and partnerships to ensure that the rewards are valuable.

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